Demand outstripping supply in Bellville

Bellville, says Morné Veer, the Rawson Property Group’s franchisee for that area (he handles property below the N1), has become yet another example of the low stock/high demand scenario, which so many strategically situated high density urban areas are now experiencing.

Veer, who has operated as a Rawson Property Group franchisee in Bellville since 2002, said that by August this year his office had already exceeded its total turnover for the 2013 calendar period. At the moment, however, stock is increasingly difficult to find, which is testament to the great demand for property in the area.

“There are two main reasons for this,” said Veer. “The first is that those who own property here, hold onto their homes and tend to reside in the area for longer than those in other areas.”

“The second reason for stock shortages”, said Veer, “is that the huge demand for property in the area, which is sought after for many reasons.”

For many people, Bellville represents the ideal residential area, said Veer, and as a result they are moving here from far and wide. Bellville’s great advantages are that it is only 17 km from the centre of Cape Town and even closer to several major industrial areas such as Montagu Gardens, Epping, Paarden Eiland, and the Brackenfell industrial node. It is also very close to many shopping centres and ideally situated to all major highways, as well as, the major corporations operating in Bellville itself. Yet, perhaps its main reason for popularity, is that it offers excellent schools.

Boston, with its prestigious D F Malan High School as well as Bellville High School, said Veer, are especially in demand and many people will make almost any sacrifice to get their children into one of these schools. D F Malan High School was included in The Cambridge University Student Guide to Excellence, a selection of 100 top schools worldwide. In recent years it has been one of the academically top-performing schools in the Western Cape. However, there are many other good schools within the Bellville area which have established good academic and sporting reputations for themselves.

“Our sales statistics confirm that the average value of a homes in the sought after parts of Bellville, have risen between 11% to 15% this year in comparison to 2013, some parts increasing in value by up to 20%, and right now I see no signs of this slowing down.”

A further attraction of Bellville, said Veer, is that, despite the phenomenal price rises, homes here are still priced 30% to 40% below those of similar size and quality in the Cape Peninsula Southern Suburbs. In the area below the N1 on which he focuses, said Veer, the price range for freestanding homes is R1,1 million to R1,5 million, on average, with certain, more upmarket, parts selling above that with ease.

Despite the ‘still reasonable’ prices, added Veer, a large portion of potential buyers with whom he deals, face a struggle to qualify for home loans, especially now that a 10% deposit is so often required.

“Even if they do have unimpaired credit records, the simple truth is that a buyer of a R1,5 million home will somehow have to find close on R250,000 to cover his deposit, his transfer fees and his moving costs. This is more than many can manage, unless he has sold a property elsewhere and has a significant profit.”

The perception that the market has swung in favour of the seller, said Veer, has, as always, led to certain sellers trying to ignore market realities and limitations, and are still attempting to achieve ridiculously high prices. This tactic, he warned, is almost always self-defeating: overpriced homes tend to stick on the market and when the seller finally ‘sees reason’, the home may well have acquired a stigma which results in their home selling below the true market value.

Looking at the rental market, said Veer, this too is showing every sign of flourishing. Typical rentals for homes in his area can be between R 7,000 to R10,000. As yet, the number of buy-to-let investors of freestanding homes has been limited, most of those buying here are doing so to house themselves and their family.